Wells Fargo on Friday reported a 9% decline in net interest income, although second-quarter profit and revenue exceeded Wall Street expectations.
Here’s how the bank fared in comparison with Wall Street estimates, based on an analyst survey conducted by LSEG:
- Earnings per share: $1.33 vs. expected $1.29
- Revenue: $20.69 billion in comparison with expected $20.29 billion
The San Francisco-based lender reported net interest income of $11.92 billion, a key measure of a bank’s loan revenue, down 9 percent from a yr earlier, below the $12.12 billion analysts expected, in response to FactSet. The bank said the decline was as a result of the impact of upper rates of interest on funding costs.
Wells Fargo shares fell nearly 7% in Friday trading.
“We continued to deliver growth in our fee-based revenues, which offset an expected decline in net interest income,” CEO Charlie Scharf said in a press release. “The investments we made enabled us to capitalize on market activity in the quarter with strong performance in investment advisory, trading and investment banking fees.”
Wells Fargo reported a decline in second-quarter net income to $4.91 billion, or $1.33 per share, from $4.94 billion, or $1.25 per share, within the year-ago quarter. The bank recorded a provision for loan losses of $1.24 billion, which included a slight reduction in the supply for those losses. Revenue rose to $20.69 billion within the quarter.
The bank repurchased greater than $12 billion value of common stock in the primary half of 2024 and expects to extend its dividend by 14% within the third quarter.
The stock has risen greater than 22% this yr, outperforming the S&P 500.
